Macungie Hotel Owner Testifies He Didn't Set Fire

August 22, 1986|The Morning Call

Richard Gaumer, 64, denied from the witness stand yesterday in federal District Court in Allentown that he committed arsonor procured someone else to start the fire that heavily damaged the Macungie Hotel about 3 a.m. on Aug. 23, 1985.

The hotel-bar-restaurant, owned by a corporation named Dido Inc. whose principal officers are Gaumer and his wife, Dolores, has been inoperative since the blaze, he said.

Gaumer claimed he was in Florida with his wife at the time of the fire and denied under cross-examination that he returned to Macungie a day or two before the fire.

The witness also denied that he hired a casual friend, "Johnny G.," who ran errands for him and who allegedly ate free meals at the hotel, to commit the arson.

The jury trial before Judge Edward Cahn in Old Lehigh Courthouse began Tuesday and is scheduled to conclude early next week.

After dismissing the jury at day's end yesterday, Cahn in open-court discussions with opposing counsel, attorney Robert Magee for Gaumer and attorneys Richard March and Jay Levin for Imperial Casualty & Indemnity Co. based in Omaha, Neb., said the jury will ultimately have to answer yes or no to these questions:

Has Imperial proved by a preponderance of the evidence that a) the fire was incendiary and b) that Gaumer was the arsonist or caused it to be set by someone else?

Was there possible fraud by Gaumer in a) obtaining renewal of a $500,000 insurance policy ($400,000 building and $100,000 contents) from Imperial by misrepresentations or concealment of the fact that Dido, not Gaumer, owned the hotel, and b) in Gaumer's submission of proof of the loss or insurance recovery claims?

A defense witness, Tammy White, 16, who worked for the hotel at the time of the fire, testified yesterday that a fellow employee told her he had cut the air hoses or beer lines at the hotel and vandalized Richard Gaumer's car prior to the fire, and that "he wasn't finished yet."

Earlier in court, Magee had identified that fellow employee as a "Jimmy Brooks." But March elicited testimony from White that Brooks did not specify what he meant, did not say directly that he planned to commit arson, and four months later denied he started the fire when asked this directly by White.

The proof of loss was the focus of much of yesterday's testimony from Gaumer's witnesses that the hotel was well-stocked with food and alcoholic beverages.

March, in cross examining vendors and other witnesses, tried to show that vendor bills were unpaid and there was little merchandise in the hotel, both as an indication of the planned arson and Gaumer's poor financial condition.

March quizzed Gaumer and his son, Douglas, who both testified that after the fire they gave food and liquor to employees and others who helped clear out the food and liquor either because it would not be re-saleable or would spoil.

But the younger Gaumer acknowledged he did not make an inventory of the items, that he took some to his home in the New Tripoli area and his father took some to his rented home in Florida.

March questioned Gaumer extensively about his extensive financial troubles, such as his filing of several bankruptcy petitions, his failure to pay vendors, his failure to repay a $100,000 federal Small Business Administration loan used to remodel and expand the business, and his alleged delinquent federal and state taxes related to several years of the hotel's operations.

Cahn cut off such questioning at one point in explaining that such collateral financial matters were only important as part of the circumstantial evidence which might show a motive by Gaumer for the alleged arson.

Gaumer said emphatically that his financial troubles began in the late 1970s when the state Department of Revenue and thefederal Internal Revenue Service began harassing him unfairly for taxes he said he did not owe or had paid already.

The disputes led him to file bankruptcy petitions for himself and his corporation, Dido Inc., he testified.

He has unsuccessfully sued the federal and state tax collection agencies and officials but testified yesterday he plans to do so again.

Fire officials and an arson expert testified earlier in the trial that the hotel fire, which damaged the mostly unused third and fourth floors and roof, was deliberately set. The building was unoccupied at the time of the blaze.

March told the jury in his opening statement that Gaumer engineered the arson as the only way out of his financial troubles and that he wanted the insurance recovery so he could retire to Florida, which Gaumer acknowledged in testimony yesterday is what he wants to do.

Magee told the panel if there was arson, Gaumer had nothing to do with it, that it might have been committed by a former employee with a revenge motive, and that Gaumer made no misrepresentations or concealments in obtaining the insurance policy renewal.

Gaumer testified yesterday that he told Earl Leiby, the insurance broker who obtained the renewal policy, about Dido as owner of the hotel, as well as mortgages or liens against the hotel by a bank, the SBA and federal and state taxmen.

Leiby in testimony Wednesday denied such claims by Gaumer, and at day's end March told Cahn in open court after the jury had left that Gaumer had started a lawsuit against Leiby.

The disclosure came after Cahn had said Leiby could be considered as Gaumer's agent in obtaining the policy from Imperial, which did not have an agency contract with Leiby.